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Sumitomo (SHI) Demag Forecasts 17% Increase in Incoming Orders for 2020

Demand from the packaging and medical technology sectors largely is driving growth, according to the maker of injection molding machines.

So, here’s some good news for a change: Injection molding machine maker Sumitomo (SHI) Demag saw incoming orders for presses made in Germany and China rise by almost 25% in the first half of 2020 compared with the first half of 2019. That has CEO Gerd Liebig “cautiously optimistic” for the future.

Liebig attributes the positive results primarily to demand coming from the packaging and medical technology sectors. "Our intentional strategic focus on these two growth markets over the past few years has placed us in a stronger position, helping us to survive during these difficult times with a strong order increase,” he said in a prepared statement.

By contrast, demand from the automotive industry has slumped sharply for the Japanese-German manufacturer of injection molding machines. The group also forecasts a wait-and-see attitude among plastics processors serving the consumer goods market, as households reckon with uncertainty in the labor market and a drop in disposable income.

Nevertheless, Sumitomo (SHI) Demag expects to report a year-on-year 17% increase in overall incoming orders for 2020 driven largely by the packaging and medtech markets. Demand for all-electric machines also is rising sharply, according to the company, which has ramped up production. “Our plant in Wiehe [Germany] is operating at full capacity, and from November 2020 we will be producing the all-electric small machines at historic [levels]," said Liebig. “The strategic focus on this series is now paying off in full: By the second half of 2020, we will double our production capacity once again in order to meet demand.” 

As a result of this increase, Sumitomo (SHI) Demag is pushing ahead with the planned cooperation with its Japanese parent company, which will begin production of IntElect machines with all-electric drive technology later in 2020.

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